Key benchmark indices extended losses for the second trading session in a row as data showing a muted 2% growth in industrial production in April 2013 weighed on sentiment. The S&P BSE Sensex managed to settle above the psychological 19,000 mark after alternately moving above and below that mark during the trading session.The Sensex settled at its lowest level in almost 8 weeks. The CNX Nifty settled at 8-week closing low. The Sensex fell 101.87 points or 0.53%, off close to 102 points from the day's high and up about 72 points from the day's low. The market breadth, indicating the overall health of the market, was negative.
Indian stocks fell for the second straight day today, 12 June 2013. The Sensex has lost 399.94 points or 2.06% in two trading sessions from a recent high of 19,441.07 on 10 June 2013. The Sensex has lost 719.17 points or 3.64% in this month so far (till 12 June 2013). The Sensex has fallen 385.58 points or 1.98% in calendar 2013 so far (till 12 June 2013). From a 52-week high of 20,443.62 on 20 May 2013, the Sensex has fallen 1,402.49 points or 6.86%. From a 52-week low of 16,553.47 on 12 June 2012, the Sensex has surged 2,487.66 points or 15.03%.
Shares of Tata Group companies declined. Tata Steel hit 52-week low. Titan Industries extended Tuesday's sharp losses triggered by the company's announcement that the Reserve Bank of India (RBI) has clarified that all imports of gold for domestic consumption, either through banks, nominated agencies or directly can be made only with 100% cash margin. Shares of two wheeler makers declined on reports oil marketing companies, which are under tremendous pressure on account of weakening rupee, are looking to increase petrol prices by Rs 1.5-2/litre from Friday, 14 June 2013.
Jindal Steel & Power surged on bargain hunting after Tuesday's 15.18% losses triggered by media reports the Central Bureau of Investigation (CBI) has registered an FIR against Congress MP and company's Chairman Naveen Jindal in the coal scam case.
The market sentiment was affected adversely by data showing that foreign funds remained net sellers of Indian stocks on Tuesday, 11 June 2013. Foreign institutional investors (FIIs) sold shares worth a net Rs 885.85 crore on Tuesday, 11 June 2013, as per provisional data from the stock exchanges.
The S&P BSE Sensex fell 101.87 points or 0.53% to 19,041.13, its lowest closing level since 18 April 2013. The index declined 173.92 points at the day's low of 18,969.08 in afternoon trade. The index rose 0.24 points at the day's high of 19,143.24 in afternoon trade.
The CNX Nifty fell 28.60 points or 0.49% to 5,760.20, its lowest closing level since 17 April 2013. The index hit a low of 5,738.60 in intraday trade. The index hit a high of 5,792.90 in intraday trade.
The BSE Mid-Cap index fell 0.60% and The BSE Small-Cap index fell 0.56%. Both these indices underperformed the Sensex.
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,392 shares fell and 966 shares rose. A total of 124 shares were unchanged.
The total turnover on BSE amounted to Rs 1927 crore, lower than Rs 2035.04 crore on Tuesday, 11 June 2013.
The S&P BSE Consumer Durables index (down 7.37%), the S&P BSE Metal index (down 1.75%), the S&P BSE IT index (down 1.45%), the S&P BSE Teck index (down 1.17%), the S&P BSE FMCG index (down 0.97%), the S&P BSE Power index (down 0.89%) and the S&P BSE Auto index (down 0.56%), underperformed the Sensex.
The S&P BSE Healthcare index (up 0.46%), the S&P BSE Oil & Gas index (up 0.45%), the S&P BSE Bankex (up 0.01%), the S&P BSE Realty index (down 0.16%), the S&P BSE PSU index (down 0.32%) and the S&P BSE Capital Goods index (down 0.35%), outperformed the Sensex.
Among the 30-share Sensex pack, 20 stocks fell and rest of them rose. Coal India (down 2.69%), TCS (down 2.06%), Infosys (down 2.02%), HDFC (down 1.27%), Bhel (down 1.24%), ITC (down 0.97%), Maruti Suzuki India (down 0.8%), L&T (down 0.52%) and Sun Pharmaceutical Industries (down 0.28%), edged lower from the Sensex pack.
Index heavyweight Reliance Industries (RIL) rose 0.65% to Rs 791.30.
ONGC rose 0.31% to Rs 309.45, with the stock reversing Tuesday's 3.91% decline. ONGC withdrew a statement issued on Monday, 10 June 2013, saying its overseas oil exploration unit ONGC Videsh (OVL) and Oil India (OIL) had signed an agreement to buy a 10% stake in a Mozambique gas field viz. Rovuma Area 1 Offshore Block from Videocon Group for $2.48 billion. The company did not give the reason for the withdrawal. The field has the potential to become one of the world's largest liquefied natural gas (LNG) producing hubs by 2018, and is strategically located to supply gas to India at competitive prices, the withdrawn statement said.
Oil India (OIL) declined 0.27%. OIL on Tuesday, 11 June 2013, said it has not contributed towards the content of the ONGC Press Release titled "OVL and OIL sign definitive agreement to acquire interest in the Rovuma Area 1 Offshore Block in Mozambique". In this regard, ONGC has already withdrawn the Press Release and factual position has been clarified by ONGC, OIL said. OIL has nothing further to add on this matter, it said.
Videocon Industries declined 0.43%. In its clarification to the stock exchanges, Videocon Industries on Tuesday, 11 June 2013, said that the company has no new information nor there any event, which requires disclosure or intimation to the stock exchanges.
Two wheeler makers edged lower on reports oil marketing companies, which are under tremendous pressure on account of weakening rupee, are looking to increase petrol prices by Rs 1.5-2/litre with effect from Friday, 14 June 2013. Hero MotoCorp (down 2.37%), Bajaj Auto (down 2.19%) and TVS Motor Company (down 1.57%), edged lower.
Jindal Steel & Power rose 3.80% to Rs 234.95, with the stock recovering on bargain hunting after Tuesday's 15.18% losses triggered by media reports the Central Bureau of Investigation (CBI) has registered an FIR against Congress MP and company's Chairman Naveen Jindal in the coal scam case. The stock was volatile. The stock hit high of Rs 240.50 and low of Rs 219. The stock had hit 52-week low of Rs 202 in intraday trade on Tuesday, 11 June 2013.
The FIR has accused Navin Jindal and Jindal Power and Steel of misrepresentation of networth and concealing previous coal allotment. They are also charged with cheating and forgery. The Naveen Jindal group was allotted a total of 11 blocks, making it the single largest beneficiary of the controversial coal block allotment.
The CBI has also filed an FIR against former Minister of State for Coal Dasari Narayan Rao.
Shares of many other companies from the metal sector declined. JSW Steel (down 4.44%), Nalco (down 3.09%), Hindalco Industries (down 2.27%), Sterlite Industries (India) (down 2.05%), Sesa Goa (down 1.94%), NMDC (down 1.32%), Hindustan Zinc (down 1.31%), Sail (down 0.91%) and Bhushan Steel (down 0.2%), edged lower.
Tata Steel lost 2.61% to Rs 274.15, with the stock extending recent slide. The stock hit 52-week low of Rs 273.15 in intraday trade today, 12 June 2013.
Most shares from the Tata Group's stable declined. Tata Coffee (down 20%), Tata Teleservices (Maharashtra) (down 19.74%), Tata Power (down 3.03%), Tata Communications (down 2.63%), Tata Metaliks (down 2.47%), Tata Global Beverages (down 1.12%), Tinplate Company of India (down 1.02%), Rallis India (down 0.35%), Tata Investment Corporation (down 0.23%) and Tata Sponge Iron (down 0.21%), edged lower.
Titan Industries tumbled 13.32% to Rs 204.90, with the stock extending Tuesday's 10.86% losses triggered by the company's announcement that the Reserve Bank of India (RBI) has clarified that all imports of gold for domestic consumption, either through banks, nominated agencies or directly can be made only with 100% cash margin. The stock hit 52-week low of Rs 201.20 in intraday trade today, 12 June 2013. The RBI has also clarified that credit of any kind from suppliers or bullion banks for import of gold for domestic use is prohibited, Titan said during trading hours on Tuesday, 11 June 2013. This will affect import of gold through all non consignment routes like gold on lease/loan, Titan Industries said. Titan imports gold for its retail gold jewellery business.
Titan said it had sought some clarifications on gold imports after the Reserve Bank of India issued a notification on 4 June 2013 on changes to the current terms governing import of gold in India.
Wockhardt lost 4.45% to Rs 1033.45, with the stock extending Tuesday's 10% slide triggered by reports that the health ministry has suspended the sale and distribution of dextropropoxyphene, a pain-relieving drug. Wockhardt markets dextropropoxyphene as Proxyvon. Dextyropropoxyphene, a 40-year-old drug, is an opioid analgesic, and was being misused by addicts. The drug has been under the government scanner for the last couple of years, with its sale already banned in the US, UK and other countries earlier.
Wockhardt last month said that the company has received an 'import alert' from the United States Food & Drug Administration (USFDA) on one of its manufacturing units located in Waluj near Aurangabad. The impact of the import alert on revenue is estimated to be in the range of $100 million on an annualised basis, Wockhardt said at that time. The company is taking all steps to address the concerns raised by USFDA and shall put all efforts to resolve the issue at the earliest, it had said.
Lanco Infratech tumbled 10.87% to Rs 6.23, with the stock extending Tuesday's 8.15% losses. The company on Tuesday, 11 June 2013, said in reply to queries made by a news channel that the company is not considering corporate debt restructuring proposal. The company also said that that the management is not considering any other debt restructuring proposal including bond issue. The debt of Lanco group excluding working capital of power companies and Griffin acquisition debt is Rs 34249 crore as at 31 March 2013. This debt is the total of 21 companies of the group. There are 15 operating companies which constitute around 50% of the debt which is serviced by them from their operations. The balance 50% debt is to projects under construction where the interest is part of project funding and part of the approved project cost, Lanco Infratech said.
Among IT shares, Mahindra Satyam gained 1.62%. Tech Mahindra rose 0.84%. The Andhra Pradesh High Court on Tuesday, 11 June 2013, cleared the merger of Mahindra Satyam with Tech Mahindra. The two companies made the announcement after trading hours on Tuesday. Earlier, the High Court of Bombay had vide its order dated 28 September 2012 approved the merger subject to approval of the Andhra Pradesh High Court.
MMTC rose 2.92% to Rs 211.45. MMTC after trading hours said that the government has decided to sell 9.33 crore equity shares, aggregating to 9.33% of the total paid up equity share capital of the company through offer for sale (OFS) route via the stock exchanges mechanism on Wednesday, 13 June 2013.
The stake sale would help the company to meet minimum public shareholding norms given by Sebi. The Government of India currently owns 99.33% stake in MMTC (as per the shareholding pattern as on 31 March 2013). Market regulator Securities & Exchange Board of India (Sebi) has mandated minimum public shareholding of 10% for state-run firms by August 2013.
Pidilite Industries rose 0.24%. The company on Tuesday said that the construction work on the synthetic elastomer project remains suspended as the company has been evaluating various alternatives regarding the future of the project. With due consideration to techno-commercial factors and completion of a strategic review, the company has decided to explore induction of a strategic partner for the project, Pidilite Industries said.
State Bank of India clocked a highest turnover of Rs 119.55 crore on BSE. Titan Industries (Rs 82.52 crore), Reliance Communications (Rs 75.08 crore), United Spirits (Rs 50.98 crore) and Jindal Steel & Power (Rs 48.98 crore), were the other turnover toppers on BSE in that order.
Reliance Communications reported highest volume of 71.94 shares on BSE. IFCI (67.96 shares), Inventure Growth & Securities (56.93 shares), Tata Teleservices (Maharashtra) (50.92 shares) and Lanco Infratech (40.82 shares), were the other volume toppers on BSE in that order.
Global rating agency Fitch today, 12 June 2013, revised India's outlook to stable from negative and affirmed its sovereign rating at 'BBB (negative)'. The revision of the outlook to stable is due the measures taken by the Government to contain the budget deficit, including the commitments made in the 2013-14 Budget, as well as some, albeit limited, progress in addressing some of the structural impediments to investment and economic growth. Fitch expects the government to broadly meet its 2013/14 fiscal deficit target of 4.8% of the gross domestic product. Fitch had cut India's outlook to negative in June 2012, following Standard & Poor's which just last month retained its negative outlook on the economy.
Industrial production rose 2% in April 2013, lower than a revised growth of 3.4% in March 2013, data released by the government today, 12 June 2013, showed. The manufacturing sector registered a growth of 2.8% and electricity generation rose 0.7%. The mining sector registered a decline of 3%. As per use-based classification, production of basic goods rose 1.3%, capital goods production rose 1%, production of intermediate goods rose 2.4% and production of consumer non-durables jumped 12.3%. Production of consumer durables declined 8.3%.
Meanwhile, industrial production growth for March 2013 was revised upwards to 3.4% from 2.5% growth reported earlier.
Inflation based on the combined consumer price index (CPI) for urban and rural India eased to 9.31% in May 2013 from 9.39% in April 2013, another data released by the government today, 12 June 2013, showed. With the CPI, inflation based on the category food and beverages stood at 10.65% in May 2013.
The Reserve Bank of India (RBI) on Tuesday took measures to increase the supply of dollars in the market including asking exporters to realise their dollar earnings and get them back into the country within one year to support a plunging rupee. The RBI also hastened the process of dollar inflows through online payment channels by increasing the amount that exporters can bring back to $10,000 from $3000. The new norms will be applicable with immediate effect, the Reserve Bank of India said. The rupee hit record low of 58.98 per dollar in intraday trade on Tuesday.
Dr. Raghuram G. Rajan, Chief Economic Adviser, Ministry of Finance, on Tuesday, 11 June 2013, said that the government continues to undertake measures to ensure the Current Account Deficit (CAD) is safely financed. Dr. Rajan issued the statement after a recent steep slide in rupee against the dollar. "In the coming weeks, we will be recommending the policies to enhance foreign direct investment (FDI) limits in a number of areas", he said. All this will help not just in the short term objective of financing the CAD but also in the longer term objective of ensuring sustainable growth, Dr. Rajan said.
European markets were mostly higher on Wednesday after data showed Euro-area industrial output unexpectedly increased in April. Key benchmark indices in Germany, France and UK were up by 0.07% to 0.38%.
Factory production in the 17-nation euro area rose 0.4% from March, when it increased a revised 0.9%, the European Union's statistics office in Luxembourg said today.
On Tuesday, Germany's constitutional court began hearing debate on whether the European Central Bank's Outright Monetary Transactions -- a yet-to-be-used program to buy bonds from struggling euro-bloc nations -- is allowable under German law. A ruling isn't expected until later this year, however.
Asian stocks fell on Wednesday as Japanese machinery orders declined more than expected and concern grew that central banks from Tokyo to Washington are increasingly reluctant to add stimulus. Key benchmark indices in Japan, Singapore and South Korea shed by 0.21% to 0.56%. Indonesia's Jakarta Composite rose 1.91%. Stock markets in Hong Kong, Taiwan and the Philippines were closed for holidays. Mainland Chinese markets are closed from Monday, 10 June 2013 till today, 12 June 2013, for the Dragon Boat Festival.
Japan's machinery orders, an indicator of future capital spending dropped 8.8% in April, more than estimated.
Trading in US index futures indicated that the Dow could gain 77 points at the opening bell on Wednesday, 12 June 2013. US stocks dropped on Tuesday after the Bank of Japan's status-quo policy decision revived concerns about the winding down of central bank stimulus measures. The restraint in Japan also raised questions about the US Federal Reserve's future direction of policy measures ahead of next week's Federal Open Market Committee meeting.
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